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We Can Talk About Income Taxes Or Having A Root Canal

 
 
Reply Sun 11 Jul, 2010 11:08 am
I am Realjohnboy. I hang out on A2K in some of the economic and political threads, as well as on other, more mundane threads. Posters often throw out income tax statistics to support or refute an argument. Often times the stats are, in my mind, taken out of context. The plan here is to try to talk about taxes in the U.S. in simple terms.
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Type: Discussion • Score: 5 • Views: 5,417 • Replies: 38
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parados
 
  1  
Reply Sun 11 Jul, 2010 11:12 am
@realjohnboy,
Government is necessary for a country to exist.
Taxes are necessary for a government to exist.

Is that simple enough for you?
0 Replies
 
realjohnboy
 
  1  
Reply Sun 11 Jul, 2010 11:22 am
A bit of housekeeping before moving on.
> I am a card carrying liberal Democrat. I think that I have positioned myself on A2K, though, as being balanced in covering an issue like this one. You are invited to visit my sleepy political thread with the title "Oh, No. Election Day..."
> The data cited here come from the IRS. I have stuff going back to 1980 and up through 2007. The math works out to divide that into four columns: 1980, 1989, 1998 and 2007.
> Figures cited are unadjusted for inflation and I have taken the liberty of rounding percentages to whole numbers. 21.37% becomes 21%, for example.
parados
 
  1  
Reply Sun 11 Jul, 2010 11:32 am
@realjohnboy,
The first piece of data to be aware of is that income taxes make up only about 50% of the Federal government revenues.

Any discussion of taxes that only relies on information from income taxes is faulty before it even begins.
realjohnboy
 
  1  
Reply Sun 11 Jul, 2010 11:35 am
DID YOU KNOW?
In 2007 there were 141 million individual tax returns filed reporting income* of some $9 trillion (I think I got that right: the number is listed as $8,798,500 million). Taxes paid were $1.1 trillion. 13% of our collective income went to the federal government to fund things at the national level.
(Hi, Parados. Thanks for watching. I am taking this a nibble at a time. But you are more then welcome to digress at will).
parados
 
  1  
Reply Sun 11 Jul, 2010 11:37 am
@parados,
I prefer to use the US Budget documents when talking about government revenues.

http://www.gpoaccess.gov/usbudget/fy11/index.html
Click the link to the historical tables pdf.

Tables 2.1, 2.2, and 2.3 give receipts by source in unadjusted dollars, % of revenues, and % of GDP.
0 Replies
 
parados
 
  1  
Reply Sun 11 Jul, 2010 11:41 am
@realjohnboy,
Quote:
Taxes paid were $1.1 trillion. 13% of our collective income went to the federal government to fund things at the national level.

Actually, that would be 13% of income went for income taxes. We pay FICA and excise taxes from our income as well.
0 Replies
 
parados
 
  1  
Reply Sun 11 Jul, 2010 11:42 am
@realjohnboy,
Do you have a link to the IRS data you are using?
Green Witch
 
  1  
Reply Sun 11 Jul, 2010 11:53 am
I see taxes as the way a country invests in itself. We chose politicians for how we think they will spend (or not spend) our money. I try and chose politicians who I believe will invest in the welfare of the people, our infrastructure and the environment. Unfortunately, I feel corporations are really the ones in charge and they prefer to spend our money on themselves and on wars in other countries.
0 Replies
 
realjohnboy
 
  1  
Reply Sun 11 Jul, 2010 12:09 pm
@parados,
Yes I do Parados. Sort of. I am not too bright when it comes to links. Please Google in "federal tax revenues income." The 3rd entry is from the Tax Foundation, which seems to me to be legitimate. I printed out the 17 pages of IRS data going back to 1980.
Please let me know if you see any flaws.
0 Replies
 
Cycloptichorn
 
  1  
Reply Sun 11 Jul, 2010 12:20 pm
As my opening post in this discussion, I assert that the lowered taxes on the wealthy which began with Reagan in 1981 have been disastrous for our country's finances and have lead to no rises whatsoever in the areas of productivity, jobs, or overall wealth. The 30-year period since then shows no greater gains than previous 30-year periods did, and significant losses - directly contrary to the claims of economic conservatives.

I am prepared to back these assertions up with data, charts and logic - should anyone foolishly claim that the opposite is true, of course.

Cycloptichorn
0 Replies
 
OmSigDAVID
 
  1  
Reply Sun 11 Jul, 2010 12:20 pm

I am a conservative-libertarian Republican, but I don 't have a card to carry.
The closest that I can approach it is my Life Member 's NRA card. Will that do ?

I favor repeal of the 16th Amendment,
with the provision that except for importation tariffs,
all operations of all governments in America,
from federal down to the smallest village, be funded thru sales taxes so that each citizen pays the same rate
and each citizen can control how much tax he pays. THAT is living in a free country.





David
OmSigDAVID
 
  1  
Reply Sun 11 Jul, 2010 12:23 pm

There shoud be immunity from any form of taxation of personal firearms and ammunition,
and their appurtenances.





David
0 Replies
 
Green Witch
 
  1  
Reply Sun 11 Jul, 2010 12:29 pm
@OmSigDAVID,
I always wondered how this might effect the economy. Our economy runs on consumption and if suddenly everything had a big tax added on would the economy tank? I'm already rather frugal, up my cost and I'll hunker down even more just because it's sort of a game with me. Would it effect poor people in a worse way because even the basics would cost so much more they would have an even harder time buying them? It might not matter to a millionaire buying a yacht, but what about a poorer person trying to buy a Hyundai?
OmSigDAVID
 
  1  
Reply Sun 11 Jul, 2010 12:30 pm

There shoud be tax credits for each citizen who certifies that he or she is well armed
(at least one fully operable revolver, loaded with hollowpointed slugs) in public, each day of the tax year.





David
0 Replies
 
OmSigDAVID
 
  1  
Reply Sun 11 Jul, 2010 12:31 pm

There shoud be other tax credits ($20 an hour) for citizens for each visit to a gunnery range for practice.


These are all very simple rules, that anyone can understand.





David
0 Replies
 
Cycloptichorn
 
  1  
Reply Sun 11 Jul, 2010 12:33 pm
@Green Witch,
Green Witch wrote:

I always wondered how this might effect the economy. Our economy runs on consumption and if suddenly everything had a big tax added on would the economy tank? I'm already rather frugal, up my cost and I'll hunker down even more just because it's sort of a game with me. Would it effect poor people in a worse way because even the basics would cost so much more they would have an even harder time buying them? It might not matter to a millionaire buying a yacht, but what about a poorer person trying to buy a Hyundai?


It not only would affect the poor to a much higher degree, the entire concept is designed exactly to do this. It is the point. People who advocate lower taxes for the rich wouldn't dream of suggesting it otherwise.

Cycloptichorn
0 Replies
 
Butrflynet
 
  1  
Reply Sun 11 Jul, 2010 12:36 pm
@realjohnboy,
realjohnboy wrote:

The plan here is to try to talk about taxes in the U.S. in simple terms.


Good luck with that!
OmSigDAVID
 
  1  
Reply Sun 11 Jul, 2010 12:47 pm
@Green Witch,
Green Witch wrote:
I always wondered how this might effect the economy. Our economy runs on consumption and if suddenly everything had a big tax added on would the economy tank? I'm already rather frugal, up my cost and I'll hunker down even more just because it's sort of a game with me. Would it effect poor people in a worse way because even the basics would cost so much more they would have an even harder time buying them? It might not matter to a millionaire buying a yacht, but what about a poorer person trying to buy a Hyundai?
I 've heard an estimated of a total sales tax of 17% covering everying. I can live with that.
No income tax; a great boon to the economy!

Its up around 9% in NYC
(tho we 've been faithfully assured that the tax will end
when the 3rd Reich and the Empire of Japan have been defeated; its been a long war).
0 Replies
 
realjohnboy
 
  1  
Reply Sun 11 Jul, 2010 01:39 pm
@Butrflynet,
Duly noted, B-Net. Pretty naive, eh?
The thing that irks me is how people will make statements without having much data to support what they are arguing for or against.
Here are some numbers for yall from the IRS in 2007:

The top 1% (1,410,710) of tax return filers earned 23% of the income* and paid 40% of the federal government's revenue from personal income taxes. Their effective tax rate was 22%.

The next 4% (5.6M) earned 15% of the income , paid 20% of the taxes for a tax rate of 18%.
6% to 10% (7M) earned 11%, paid 11% for a tax rate of 13%.

Then we get into the larger number of people.
21M taxpayers (21% of the total) earned* around $100K in 2007. They contributed 15% in income taxes to the federal government. Their tax rate was about 9%.
35M (19%) of us earned around $50K, and our share was 11% of the federal government's revenue. Our tax rate was 7%.

Add that up and you will find that some 70 million of us- 50% of those filing, accounted for 88% of the reported income and paid 97% of the taxes. The tax burden was 14% overall.

50% of filers, with incomes below about $33K, earned 12% of the total income* and paid 3% of the income taxes. The effective tax rate was also 3%.

*The IRS, in its review, starts not with income, but with adjusted gross income. That excludes income from capital gains, dividends and municipal bond
 

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